Industrial sector sees closure of 35 major companies in 2008-15

Greek industries seem to be stuck in one of the bleakest chapters of their recent history as they find themselves unable – mostly for reasons beyond their control – to compete with their rivals abroad.

According to estimates by the European Commission, the Greek manufacturing sector shrank from 141 large companies (with over 250 employees each) in 2008 to 106 at the end of 2015, resulting in losses of 2.9 billion euros’ worth of production for the economy.

In the steel industry and related activities, the crisis has also been compounded by a rise in the cost of energy, which has prevented Greek businesses from making up for the slump in domestic sales with exports as their costs are much higher than those of their European rivals.

One of the examples cited by the report is that of steel producer Hellenic Halyvourgia, which had been underproducing since 2011 and was forced to close in 2014. Hellenic Steel, a subsidiary of Italy’s Ilva, went into administration in 2014 and closed shortly thereafter. These closures came after Arcelor Mittal, owner of Konti Steel in central Greece, decided to close its plant down in 2011, and Halyvourgiki Hellenic Steel Industry took affirmative measures to safeguard its continued operation in 2012.

Businesses

In a separate report, also highlighting the adverse effects of the crisis, the Commission found that Greece had 157,134 fewer registered businesses in 2014 from 2008.

Small and medium-sized enterprises (SMEs) have been the worst hit, shrinking from 849,389 to 692,286. In terms of jobs, this translates into 1,815,465 positions from 2,310,905 (-21 percent).

In the case of big businesses, the impact of losses is much more far-reaching. In the 2008-14 period, the number of large companies in Greece dropped from 431 to 400, leading to a further 20.42 percent reduction in jobs.

According to the General Electronic Commercial Registry (GEMI), 24,846 sole proprietorships and corporations were struck off the register in 2015. Another 16,994 have gone in the first half of this year alone.

The Confederation of Professionals, Craftsmen & Merchants (GSEVEE), meanwhile, estimates that by this fall, the number of closures will reach 21,000, resulting in 40,000-45,000 job losses.